Speaker 1: Hi, it's West Kasova. We're taking a break today for
Speaker 1: the US holiday. Here's one of our favorite episodes that
Speaker 1: you may have missed. Thanks for listening. We'll be back
Speaker 1: tomorrow with another new Big Take. You're walking through pools
Speaker 1: of water, little underground streams. It really is one of
Speaker 1: the most extreme environments that I've ever been in. From
Speaker 1: Bloomberg News and I Heart Radio, it's the Big Take.
Speaker 1: I'm West Cosova. Each weekday we dig into one important story,
Speaker 1: and today the worldwide hunt for copper. Soon there might
Speaker 1: not be enough of it to feed our insatiable demand.
Speaker 1: The soundclip you heard at the top of the show.
Speaker 1: That was Bloomberg reporter Matthew Hill. He traveled to a
Speaker 1: huge copper mine in Zambia in Southern Africa, and he's
Speaker 1: here to tell the incredible story of what it takes
Speaker 1: to get copper out of the ground and into your
Speaker 1: computer or your car, the wiring in your house. I
Speaker 1: talked to Matt in just a bit, but first let's
Speaker 1: talk about why copper matters so much. Because I'll admit
Speaker 1: I don't spend a whole lot of time worrying about
Speaker 1: the global copper supply, and I suspect you might not either.
Speaker 1: In fact, our producer Michael Falero went out onto the
Speaker 1: street in Washington, d C. To measure people's copper i Q.
Speaker 1: He asked them a simple question. A smartphone and air conditioner,
Speaker 1: an extension cord in a car? What material do they
Speaker 1: all share? Is plastic mercury motherboard? Why is um aluminium copper?
Speaker 1: All right, it's not a trick question. Don't ever think
Speaker 1: it right. I absolutely would have failed that quiz, So
Speaker 1: I feel a bit better that most of those folks
Speaker 1: did too. If we're looking towards a future of clean energy,
Speaker 1: clean electricity, copper is a critical ingredient and we'll need
Speaker 1: more and more of it. So we asked a couple
Speaker 1: of people who do spend a lot of time worrying
Speaker 1: about the global copper supply to explain what a big
Speaker 1: deal it is. Von Lee is a metals in mining
Speaker 1: reporter for Bloomberg based in New York. One thing is
Speaker 1: that if you're believing this electrification story, then copper really
Speaker 1: has the the feature for that, because copper has the
Speaker 1: most conductivity of all metals. Basically, not only your evs
Speaker 1: need copper, but power grids, energy storage, wing turbines, solar panels.
Speaker 1: They all need copper because copper is simply is kind
Speaker 1: of the best metal for electrification. So how much copper
Speaker 1: does the world need? Well, think about this. The average
Speaker 1: car contains sixty pounds of copper. That's about twenty nine kilos.
Speaker 1: For an electric vehicle or e V, it can be
Speaker 1: a lot more. Here's James Atwood, a senior commodities reporter
Speaker 1: for Bloomberg based in Santiago, Chile, one of the world's
Speaker 1: biggest copper producers. In an electric vehicle, it can be
Speaker 1: double or as much as four times that amount because
Speaker 1: of the reach out to batteries and it's electric gup,
Speaker 1: basically anything with word electric, and it means it's going
Speaker 1: to be a bit of copper, and you know whatever,
Speaker 1: The prices of copper go up, and then people look
Speaker 1: at things like aluminium and even plastic as alternatives of
Speaker 1: substitutes for copper, but there's no easy substitutes for the copper. Globally,
Speaker 1: minds produce about twenty one million metric tons of copper
Speaker 1: each year, and in a little more than a decade
Speaker 1: the world's demand is expected to more than double. I
Speaker 1: sat down with a van and aims to hear more
Speaker 1: about what's at stake. Yes, I mean copies right now
Speaker 1: is sitting on about seven five hundred dollars a ton.
Speaker 1: It was more than ten thousand dollars early this year.
Speaker 1: There are several analysts who are looking at more like
Speaker 1: fifteen thousand in the not too disti future. So doubling
Speaker 1: prices so that obviously that has a varying on water inflation,
Speaker 1: the potential to be a constraints on economic growth, but
Speaker 1: it also has a potential to be a constraint on
Speaker 1: net zero targets. How long does it take to make
Speaker 1: a new mind. Let's say today I have all the
Speaker 1: money in the world and I want to get a big,
Speaker 1: rich vein of copper, and I know where it is
Speaker 1: and have the permits. How long will it take? It
Speaker 1: takes about eight to ten years, give or a take.
Speaker 1: You need to build a mind. That takes years, and
Speaker 1: for a mind to be fully operating, that's a multi
Speaker 1: year process. That's why we are saying people are worried
Speaker 1: that we don't have enough investment right now because down
Speaker 1: the line and next five years or so, we will
Speaker 1: be needing all the copper. And that's why if we
Speaker 1: don't have investment now, then we will be running out
Speaker 1: of copper really soon. Do you envision a sort of
Speaker 1: a balance here where we need copper for renewable sources
Speaker 1: of energy and we need for all kinds of other
Speaker 1: things that we're going to need in the future, and
Speaker 1: yet it's dirty to produce. Is there a balance where
Speaker 1: the environmental costs of new mining and extensive extra mining
Speaker 1: from existing minds is outweighed by the benefit down the road,
Speaker 1: or do we eventually come to a point where we're
Speaker 1: gonna need something else besides copper. Yes, I think the
Speaker 1: kind of like environmental and economic benefits outweighed the dirty
Speaker 1: part of copper mining, because I feel like if we
Speaker 1: are really serious about decombronization, we want to electrify the economy,
Speaker 1: there has to be some short term compromise to make
Speaker 1: so that we can achieve long term decobronization. Yes, we
Speaker 1: usually associate money with kind of like dirty you see
Speaker 1: dust and blast explosion and things like that, But the
Speaker 1: benefit of having all the metals in a circular economy
Speaker 1: is really beneficial to this clear energy future. So looking
Speaker 1: down the road, how concerned should people be that copper
Speaker 1: isn't going to be available, that products are gonna rise
Speaker 1: in price as a result of it, or be in
Speaker 1: short supply, and that the move towards non carbon based energy,
Speaker 1: cleaner energy is going to stall out if we cannot
Speaker 1: solve this looming copper shortage. I guess what just has
Speaker 1: to be stuck with fossil fuel for a relatively longer
Speaker 1: period of time, And I guess if you want to
Speaker 1: buy an evy you'll have to pay a lot more
Speaker 1: then if we solve the copper shortage problem. In the
Speaker 1: short term, prices are coming off a bit lower than
Speaker 1: they were. Demand that look needs to and demand that
Speaker 1: looks bleak just as demand weakens or seems to be weakening,
Speaker 1: supplies coming on. That's what's causing this short term pullback.
Speaker 1: But all that changes, according to the analysts that middle
Speaker 1: part of this decade, and that's when the tightness really
Speaker 1: starts becoming more visible and we'll start to bite. But
Speaker 1: when you talk to people kind of in the industry,
Speaker 1: are they worried about what's gonna happen? Yeah, they were
Speaker 1: just saying kind of like, we don't have the investment
Speaker 1: we need for the foreseeable future. So that's going to
Speaker 1: be a huge problem. And I would say if Elon
Speaker 1: Musk is really serious about energy transition, he should invest
Speaker 1: in copper mining. Thank you so much, James Edward. I've
Speaker 1: only really appreciate you taking the time and educating us
Speaker 1: on this big problem. Thank you for having me. After
Speaker 1: the break, I talked with Bloomberg reporter Matthew Hill about
Speaker 1: what it's like to go deep underground in a Zambian
Speaker 1: copper mine. So we've been talking about how important copper
Speaker 1: is to an energy future with fossil fuels for clean energy,
Speaker 1: and one of the big problems is that there is
Speaker 1: going to be a shortage of copper and coming years.
Speaker 1: There is a whole lot of copper in one place, though,
Speaker 1: and that is in Southern Africa and Zambia, in the
Speaker 1: area around the Democratic Republic of Congo. And so you'd think, great,
Speaker 1: they have big minds there. We can get the copper,
Speaker 1: but not so fast. Matthew Hill is joining me now.
Speaker 1: He's Bloomberg recorder based in Umbumbella in eastern South Africa,
Speaker 1: and he has written a story called The Medals for
Speaker 1: Your ev are stuck in a thirty mile African traffic jam, Matt,
Speaker 1: thanks for being here. Yeah, thanks very much for having
Speaker 1: me on. So you went to this enormous mind in
Speaker 1: Zambia which produces a whole lot of copper. How much
Speaker 1: copper is there in this region, the Central African copper
Speaker 1: belt that extends from southern Democratic Republic of Congo into
Speaker 1: northern Zambia northwestern Zambia. The area is bigger than the
Speaker 1: size of the country of Portugal, but over the past
Speaker 1: few decades very little of that copper has been exploited.
Speaker 1: Right now, together, Zambia and the Congo only account for
Speaker 1: about twelve of global copper production, but there is the
Speaker 1: potential to produce much much more than that. So there
Speaker 1: are many many tons of copper under the ground, and
Speaker 1: if they can get at it, it could go a
Speaker 1: long way to alleviating a future Kapper shortage exactly. So,
Speaker 1: Um you mentioned Democratic Republic of Congo, which sits right
Speaker 1: on Zambia's border to the north, and between the two
Speaker 1: of them there is an enormous amount of copper and
Speaker 1: a lot of travel between them to get that copper out,
Speaker 1: and that is the subject of your story. You went
Speaker 1: to a very large copper mine in Zambia and show
Speaker 1: just how hard it is to get it out of
Speaker 1: the ground and get it then to where it needs
Speaker 1: to be. Can you describe the mind? What did you
Speaker 1: see there? What was it like? The mind that we
Speaker 1: went to is in a small town called Muffu Lira
Speaker 1: in northern Zambia. Operations they're actually started in the nineteen thirties,
Speaker 1: so it's one of Africa's oldest copper minds. It's also
Speaker 1: one of Africa's deepest copper minds. We went down a
Speaker 1: new shoft just recently built that extends one thousand five
Speaker 1: ms below the Earth's surface. All Right, I gotta ask
Speaker 1: you about this because I've never been down in the
Speaker 1: capermin and frankly, that sounds a little terrifying to me.
Speaker 1: What is it like to write down one of those
Speaker 1: shafts to mine that deep? Yeah, it's quite crazy. You
Speaker 1: get in what the mining folk call a cage um,
Speaker 1: which is just the industrial name for a giant elevator.
Speaker 1: It really goes quickly. We actually went right down to
Speaker 1: the bottom of the mine. Even though it's in the
Speaker 1: middle of the African continent, it's actually below sea level.
Speaker 1: That's how deep it is. It's quite an intense environment
Speaker 1: down there. I mean the rocks just because of the
Speaker 1: sheer pressure you're going so deep below the Earth's surface.
Speaker 1: The temperature of the rocks is forty degrees celsius, which
Speaker 1: for those Americans is very hot. Yeah, I mean that's
Speaker 1: well well into the nineties. It's also one of the
Speaker 1: Earth's wettest copper mines because it's in Central Africa. There's
Speaker 1: a lot of rain during the wet season, and that permeates,
Speaker 1: I mean it takes a long time, but that permeates
Speaker 1: down below the Earth's surface. And you've got these huge
Speaker 1: underground rivers flowing. At this particular mining shop. They have
Speaker 1: to pump up the equivalent of forty seven Olympic sized
Speaker 1: swimming pools worth of water every day, and that's just
Speaker 1: to keep it from flooding the mine shafts exactly. So
Speaker 1: they've got these massive underground pump stations which are just
Speaker 1: constantly pumping up to the surface this water that's flowing down.
Speaker 1: I mean, it's like waterfalls and you're walking through pools
Speaker 1: of water, little underground streams. It really is one of
Speaker 1: the most extreme environments that I've ever been in. And
Speaker 1: then how is it cover actually removed. When the miners do,
Speaker 1: are they blasting it? Are they using pixar? It must
Speaker 1: be a fairly industrial activity, very much so they blast
Speaker 1: or out of the or being the rocks that contained
Speaker 1: the copper they blasted out. In my hands, I've got
Speaker 1: some of the rocks that have been blasted out of
Speaker 1: the walls here. It's actually quite astounding how you can
Speaker 1: see the copper visibly showing up in the rocks. This
Speaker 1: is the richest copper that this mine has, and it's
Speaker 1: got just slightly more than two grams pop copper per
Speaker 1: ton of rock. So to produce the copper, you've got
Speaker 1: to move a lot of rock, then loaded into dump trucks.
Speaker 1: Those trucks haul it to the shot, which is the
Speaker 1: vertical tunnel that goes down to the bottom where it's
Speaker 1: loaded into cages and then hauled back up to the
Speaker 1: surface where it goes through a whole other process to
Speaker 1: pret use a product that is ninety nine point nine
Speaker 1: nine mine copper, so pretty pure, and that all happens
Speaker 1: on the site of the mine where it is mind
Speaker 1: and refined to that very pure copper, which is then
Speaker 1: essentially a product exactly. It's all within the vicinity of
Speaker 1: the muffule Era mine. How much is that copper worth
Speaker 1: right now in the market if you look at the
Speaker 1: current copper price, which is about seven thousand, five hundred
Speaker 1: dollars per ton, And I must point out that especially
Speaker 1: over the past year, the price has been extremely volatile.
Speaker 1: It reached a new record above ten thousand dollars per
Speaker 1: ton earlier this year um and has since fallen quite
Speaker 1: a bit. But just at the current copper price, you
Speaker 1: are looking at about six hundred and seventy five million dollars.
Speaker 1: You can see why it's worth all this effort you
Speaker 1: just described to get this out of the ground. Absolutely,
Speaker 1: do we know who's buying it where it ends up.
Speaker 1: The majority of that copper probably ends up in China,
Speaker 1: which accounts for about of global copper demand. And that's
Speaker 1: because China produces so much of the world's electronics and
Speaker 1: solar panels and other things where copper is used. Exactly,
Speaker 1: so you can imagine, I mean, when you're talking about
Speaker 1: removing tons of earth at the end, only the tiniest,
Speaker 1: tiniest portion of that is actually copper. Uh, And so
Speaker 1: you are hauling an enormous amount out of the ground
Speaker 1: in order to get very very little, which I guess
Speaker 1: explains why copper is just so expensive in many ways.
Speaker 1: That's the easy pot. There are no shortage of buyers
Speaker 1: for all of that copper. By getting it into their
Speaker 1: hands is a harrowing journey. When we come back, Matt
Speaker 1: is going to describe the very long trip by truck
Speaker 1: to get that copper to port. Now, so you went
Speaker 1: down into the mine and you watched how it is
Speaker 1: brought up from deep in the ground and refined into copper,
Speaker 1: and next is trying to get into the hands of
Speaker 1: the people who want to use it. Um, can you
Speaker 1: describe exactly what it takes to do that? Well, it
Speaker 1: must be one of the most difficult jobs in the world,
Speaker 1: if not one of the longest jobs in the world.
Speaker 1: To complete. Watch should be a relatively simple task. From
Speaker 1: the Democratic Republic of Congo, the mind's just north of
Speaker 1: the Zambian border there, which are actually much bigger than
Speaker 1: the Zambian minds in terms of production. You are looking
Speaker 1: at about three thousand kilometers down to the port of Durban,
Speaker 1: just off South Africa's east coast, which has always been
Speaker 1: the most important port for copper exports out of the
Speaker 1: Central African copper belt for both Zambia as well as
Speaker 1: the Democratic Republic of Congo. That three thousand kilometer journey
Speaker 1: this year, it's taken more than thirty days, and that
Speaker 1: trip is incredibly long. And Heroin, can you describe it?
Speaker 1: Because you and a long this route and you saw
Speaker 1: what it's like to transport copper. One of the most
Speaker 1: interesting things I've ever seen in my life is the
Speaker 1: Kasumber Lesser border between Zambia and the Congo. That in
Speaker 1: essence is where the biggest problem is. Um You've got
Speaker 1: on the Zambian side a queue of trucks waiting to
Speaker 1: cross into the Democratic Republic of Congo about fifty kilometers long.
Speaker 1: So that's where the title of your story comes. That's
Speaker 1: about thirty two miles. So there's thirty two mile long
Speaker 1: queue of trucks all just waiting to get underwet. Yeah,
Speaker 1: and these drivers are there for days. I mean as
Speaker 1: as long as a week it takes to cross that border.
Speaker 1: Why does it take so long across the border? The
Speaker 1: growth in production out of the copper mines in the
Speaker 1: Democratic Republic of Congo has been so large that the
Speaker 1: customs officials haven't been able to keep up, So it
Speaker 1: takes that long just to get your papers and make
Speaker 1: it all officials so that you can then just hit
Speaker 1: the road exactly. The border process is extremely slow and
Speaker 1: these drivers spend as long as a week waiting in
Speaker 1: these queues. So what are they doing? I mean they're
Speaker 1: sitting in trucks. Where do they sleep? How do they eat?
Speaker 1: What is the scene like there? Everything's just centered around
Speaker 1: the cow and of their truck. That's their home. And
Speaker 1: bear in mind that there's this is rural rural Africa.
Speaker 1: In many stretches of of the queue, there's not even villages.
Speaker 1: So these these drivers are just sitting chatting to the
Speaker 1: other drivers. There's no toilets, there's no showers, there's no
Speaker 1: real formal shops or restaurants. This is rural Africa that
Speaker 1: these guys are sitting in. End. I mean the temperatures
Speaker 1: there in the summertime get extremely hot. And in your
Speaker 1: story you talk about how a whole informal economy has
Speaker 1: grown up around serving these drivers needs at the Kasumber
Speaker 1: Lesser border itself. It's extremely interesting because you've you've got
Speaker 1: this hive of activity that sprung up around um just
Speaker 1: this cross border commerce between the Zambie and Congo, a
Speaker 1: lot of it being almost all of it being because
Speaker 1: of the mining industry. So you've got guys walking around
Speaker 1: in modified, heavily modified bicycles. They don't even have seats.
Speaker 1: They just built to transport goods, water, cookies, or even
Speaker 1: charcoal that the truck drivers and other people used to
Speaker 1: cook their food. There's just this whole hive of informal
Speaker 1: economy that's trying to make money off the truck drivers
Speaker 1: who have not much choice of how to fill their
Speaker 1: bellies or where to get drinking water and that sort
Speaker 1: of thing. You talked to a lot of the drivers
Speaker 1: while they were just sitting there waiting to get underway.
Speaker 1: What did they have to say about their lives. Well,
Speaker 1: they are very appreciative of how and the scriptive of
Speaker 1: how tough their jobs are. Most of them are very
Speaker 1: eager to speak to me because they have an incredibly
Speaker 1: difficult job and they want to tell people about that.
Speaker 1: One of the things that the drivers were most eager
Speaker 1: to speak about is just how dangerous it is for
Speaker 1: them to cross into the Democratic Republic of Congo. They
Speaker 1: complained bitterly about police corruption there, basically police demanding that
Speaker 1: they pay bribes. It's number one corruption and because the
Speaker 1: police there, even if you haven't done nothing, they can
Speaker 1: even come to your truck and my brother, ah, I
Speaker 1: can see your light is not okay. He hasn't even
Speaker 1: checked the truck. So you must have something on the
Speaker 1: on the road. No money, ah, you can die. There's
Speaker 1: also a problem of crime. When the drivers are sitting
Speaker 1: there with their trucks are sort of like sitting nuts
Speaker 1: for thieves. Yeah, exactly. Um And a few of the
Speaker 1: drives that I spoke to raise that issue, one of
Speaker 1: them said that he basically has to sleep with one
Speaker 1: eye open because especially this year, with the rocketing price
Speaker 1: of diesel UM, that's also made the diesel in their
Speaker 1: trucks a very lucrative target for thieves. You does sleep
Speaker 1: like absolutely pink because sometimes when you hear someone who
Speaker 1: move around that outside, you wake up. And then if
Speaker 1: they're able to make it through and it reaches port,
Speaker 1: then what happens Earlier this year, the port of Durban
Speaker 1: in South Africa, which is the port that the mining
Speaker 1: companies rely on more than any other in the region
Speaker 1: to export their copper, that the port of Durbon was
Speaker 1: hit by floods not seen in decades. The floods not
Speaker 1: only killed more than four people, but they caused severe
Speaker 1: damage to the port. The damage that these floods caused
Speaker 1: has only made matters worse. When I visited the port
Speaker 1: earlier this year, it was still recovering from the floods.
Speaker 1: They washed away roads and damaged warehouses. It's very difficult
Speaker 1: to explain how bad the damage was. So if these
Speaker 1: drivers are waiting as long as two weeks just to
Speaker 1: get out of Congo and into Zambia, and then they
Speaker 1: have to go on this very dangerous and long trek
Speaker 1: down to port, how long does it on average take
Speaker 1: to get a load of copper from the mind to
Speaker 1: the port? From the companies that I spoke to this year,
Speaker 1: they considered about a month of fairly average time. Matt
Speaker 1: Is the world's demand increases for this copper, it seems
Speaker 1: like this is not a process that can go on
Speaker 1: and forever. They're going to have to do something about
Speaker 1: this to make it more efficient. Is there anything actually
Speaker 1: being done to ease the supply eyeline from the mind
Speaker 1: to the ports so that it is not this just
Speaker 1: like mad Max like story that you've described here, This
Speaker 1: is the billion dollar question. So far, what companies have
Speaker 1: been doing to try solve the problem of congestion is
Speaker 1: to throw more trucks at it, which of course only
Speaker 1: makes more congestion. Ultimately, the most sustainable solution is to
Speaker 1: improve rail connectivity. That's what a lot of the mining
Speaker 1: companies have been saying. They need to be able to
Speaker 1: move more of the logistics onto rail. But building rail
Speaker 1: is expensive and it takes a long time. Is there
Speaker 1: actually plans to do that now? I mean, the Congolese
Speaker 1: government a few months ago unveiled an investment plan of
Speaker 1: about fifty eight billion dollars to upgrade their countries infrastructure.
Speaker 1: A lot of that is required both road and rail.
Speaker 1: The Zambian government already has a railway line connecting the
Speaker 1: copper belt to the port of Darius Salem in Tanzania,
Speaker 1: but that's fallen into complete disrepair, so that's going to
Speaker 1: take a lot of investment to get the upper end
Speaker 1: and running again. There's also a railway connectivity from the
Speaker 1: Zambian copper belt to the port of Durban, but once
Speaker 1: again that's going to need a lot of investment. It's
Speaker 1: not that there will be one solution, but probably a
Speaker 1: number of different solutions which will require investment from both
Speaker 1: the governments involved as well as private companies to make
Speaker 1: sure that there is a sustainable way to get the
Speaker 1: copper out of this resource that the world desperately needs
Speaker 1: over the next couple of decades to the places that
Speaker 1: needed Matt Hill, thanks for coming on the show. Thank
Speaker 1: you very much for having me up. Really enjoy talking
Speaker 1: about this. You can read more about Matthew Hill's journey
Speaker 1: to the Zambie and coppermine and see photos of his
Speaker 1: trip at Bloomberg dot com. That's also where you'll find
Speaker 1: the latest reporting from Yvon Lee and James Atwood. Thanks
Speaker 1: for listening to us here at The Big Take, the
Speaker 1: daily podcast from Bloomberg and I Heart Radio. For more
Speaker 1: shows from my Heart Radio, visit the i Heart Radio app,
Speaker 1: Apple Podcasts, or wherever you listen. Read today's story and
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Speaker 1: Big Take, and we'd love to hear from you. Email
Speaker 1: us with questions or comments to Big Take at Bloomberg
Speaker 1: dot net. The supervising producer of The Big Take is
Speaker 1: Vicky Burgalina. Our senior producer is Katherine Fink. Our producers
Speaker 1: are Moe Barrow and Michael Falerro Hill de Garcia is
Speaker 1: our engineer. Original music by Leo Sidrin. I'm Westcosova. Have
Speaker 1: a great weekend.